1. By the early 1970s IKEA had established itself as the largest furniture retailer in Sweden.

What was
the source of its competitive advantage at that time?
--IKEA established itself as the largest furniture retailer in Sweden by the early 1970s by reinventing
the wheel of furniture manufacturing at that time. Majority of furniture manufacturers in Sweden
produced expensive products with designs that were basic or passed down generation to generation,
additionally other manufacturers stores where located in downtown congested areas. IKEAs
strategies which consisted of low cost low priced furniture, brave intricate designs, self-assembly,
and stores located in open rural areas all contributed to them becoming the largest furniture retailer
in Sweden.

2. Why do you think IKEAs expansion into Europe went so well? Why did the company
subsequently stumble in North America? What lessons did IKEA learn from this experience? How is
the company now applying these lessons?

--Western European furniture markets were largely fragmented and were served by high-costs
retailers located in expensive downtown stores and were not always ready for delivery as IKEA
furniture was. The European expansion was fast-paced and IKEAs furniture had lower prices, offered
cleaner lines, and their self-service format which gave European customers a new wave of
excitement and choice. Several instances caused IKEA to stumble in America, their beds were
measured in centimeters and not the king, queen, and twin sizes, their glasses proved too small for
Americans liking, and they were shipping overseas and priced in the Kroner which at the time was
strengthening against the US dollar, this drove up the pricing of goods in IKEAs American stores. IKEA
failed to understand the culture in the North america, self-service was not huge success and store
layout and products were to small for big american customer. So, IKEA change the a lot of things,
Ikea redesign to fit with needs and culture, newer and larger store location were chosen, improve the
efficiency of delivery and offer delivery services.

3. How would you characterize IKEAs strategy prior to its missteps in North America? How
would you characterize its strategy today?
--IKEAs strategy prior to its missteps in North America is Standardization. When IKEA expand to
other european countries, it use the same strategy in sweden, that is low price, high quality,
immediate availability and self assambly. But today standardization combined with adaption. After
its failed in North america and not very succesful in china, IKEA realized the importance of
adaptation.

4. What is IKEAs strategy toward its suppliers? How important is this strategy to IKEAs success?
-IKEA main supplier are swedwood an IKEA owned manufacturers.
-Long term co-operation to give best possible results.
-produce products of good function-flexibility
-strategy of limiting investment in productive capacity.

5. What is the source of IKEAs success today? Can you see any weaknesses in the company? What
might it do to correct these?
-using in-expensive materials in new way.
-to cut transportation cost
n my opinion, IKEA weakness is lack common structure and planning.




mer zdemir
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